Policy Uncertainty Threatens to Slow Renewable Energy Momentum

Posted by Michelle Howard
Thursday, August 28, 2014
Photo courtesy of IEA

IEA forecast sees renewable power as a cost-competitive option in an increasing number of cases, but facing growing risks to deployment over the medium term.

The expansion of renewable energy will slow over the next five years unless policy uncertainty is diminished, the International Energy Agency (IEA) said today in its third annual Medium-Term Renewable Energy Market Report.


According to the report, power generation from renewable sources such as wind, solar and hydro grew strongly in 2013, reaching almost 22% of global generation, and was on par with electricity from gas, whose generation remained relatively stable. Global renewable generation is seen rising by 45% and making up nearly 26% of global electricity generation by 2020. Yet annual growth in new renewable power is seen slowing and stabilising after 2014, putting renewables at risk of falling short of the absolute generation levels needed to meet global climate change objectives.


Non-OECD markets, spurred by diversification needs in many countries and increasing air quality concerns in China, in particular, comprise almost 70% of the growth. Renewables are seen as the largest new source of non-OECD generation through 2020. Yet they meet only 35% of fast-growing electricity needs there, illustrating the still-large role of fossil fuels and the potential for further renewable growth. Renewables account for 80% of new power generation in the OECD, but with more limited upside due to sluggish demand and growing policy risks in key markets.


“Renewables are a necessary part of energy security. However, just when they are becoming a cost-competitive option in an increasing number of cases, policy and regulatory uncertainty is rising in some key markets. This stems from concerns about the costs of deploying renewables,” said IEA Executive Director Maria van der Hoeven.


“Governments must distinguish more clearly between the past, present and future, as costs are falling over time,” she added. “Many renewables no longer need high incentive levels. Rather, given their capital-intensive nature, renewables require a market context that assures a reasonable and predictable return for investors. This calls for a serious reflection on market design needed to achieve a more sustainable world energy mix.”


The report noted that policy and market risks threaten to slow deployment momentum. For example, in many non-OECD markets including China, constraints include non-economic barriers, an absence of needed grid integration measures, and the cost and availability of financing. In the European Union (EU), uncertainties remain over the precise nature of the post-2020 renewable policy framework and the build-out of a pan-European grid to facilitate the integration of variable renewables.


For the first time, the annual report provides a renewable power investment outlook. Through 2020, investment in new renewable power capacity is seen averaging over USD 230 billion annually. That is lower than the around USD 250 billion invested in 2013. The decline is due to expectations that both unit investment costs for some technologies will fall and that global capacity growth will slow. With decreasing costs, competitive opportunities are expanding for some renewables under some country-specific conditions and policy frameworks. For example, in Brazil, with good resources and financing conditions, onshore wind has continued to outbid new-build natural gas plants in auctions. In northern Chile, high wholesale electricity prices and high irradiation levels have opened a new unsubsidised solar market.


The roles of biofuels for transport and renewable heat are also increasing, though at slower rates than renewable electricity. Uncertainty over policy support for biofuels is rising in the EU and the United States, slowing expectations for production growth and threatening the development of the advanced biofuels industry at a time when the first commercial plants are just coming online.


The annual report highlights the potential energy security implications of energy use for heat, which accounts for more than half of world final energy consumption and is dominated by fossil fuels. But the contribution of renewables to meet heating and cooling needs remains underdeveloped, with more limited policy frameworks compared with the electricity and transport sectors. Although modern renewable energy sources are expected to grow by almost 25% to 2020, their share in energy use for heat rises to only 9%, up from 8% in 2013.


 

Maritime Reporter April 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Technology

SeaHow Skimmer System

New SeaHow skimmer systems – designed to collect both light and heavy oils efficiently – can be implemented in almost any work boat, starting with vessels only six meters long.

STX France Shipyard Adds More Automated Welding

A good order book and need for higher capacity in the dock were the basis for STX France to purchase more welding automation for its shipyard’s panel welding.   STX

IMCA Publishes Introduction to Inertial Navigation

The increased use of inertial navigation systems (INS), particularly in support of offshore survey, installation and inspection tasks, has emphasized the need for

Finance

Committee to Consider Coast Guard Authorization Bill

The U.S. Committee on Transportation and Infrastructure, chaired by U.S. Rep. Bill Shuster (R-Pa.), will mark up legislation this week that authorizes United States

Med Crude-Urals Stronger in Baltic as Surgut Sells Cargoes

Russian Urals crude price differentials strengthened in the Baltic in a spot tender on Tuesday after loading schedules confirmed scarce export volumes for May.   There

Canada Invests In Port Lambton Rescue Station

Inshore Rescue Boat Station upgraded as part of federal infrastructure commitment   On behalf of the Honorable Gail Shea, Minister of Fisheries and Oceans, Pat Davidson,

Environmental

Groups Seek US SEC Probe of Shell Arctic Drilling Risk Disclosures

An environmental group and a law clinic petitioned the U.S. Securities and Exchange Commission to investigate whether Royal Dutch Shell has adequately disclosed

Long Beach to Decide on Cement Import Facility

Board will review Mitsubishi project at meeting May 11   The Port of Long Beach has prepared the final environmental impact report for the Mitsubishi (MCC) Cement Facility Modification Project.

SeaHow Skimmer System

New SeaHow skimmer systems – designed to collect both light and heavy oils efficiently – can be implemented in almost any work boat, starting with vessels only six meters long.

Energy

Groups Seek US SEC Probe of Shell Arctic Drilling Risk Disclosures

An environmental group and a law clinic petitioned the U.S. Securities and Exchange Commission to investigate whether Royal Dutch Shell has adequately disclosed

Med Crude-Urals Stronger in Baltic as Surgut Sells Cargoes

Russian Urals crude price differentials strengthened in the Baltic in a spot tender on Tuesday after loading schedules confirmed scarce export volumes for May.   There

Oil Rallies Briefly after Iran Seizes Cargo Ship

Oil prices rallied briefly on Tuesday after reports that Iran had seized a cargo vessel, described initially by Iranian and Saudi media as a U.S. ship, raised geopolitical

LNG

DEME Orders LNG-powered Dredgers from Royal IHC

Royal IHC has been awarded a contract for the design, construction and delivery of two unique low-emission dredging vessels to DEME in Belgium, the builder announced today.

Floating LNG Regasification is Used in Smaller Markets

According to the latest research from the US Energy Information Administration (EIA), floating LNG (FLNG) regasification is being used to meet rising natural gas demand in smaller markets.

Drydocks World Wins Dubai Chamber CSR Label

Drydocks World group the leading provider of maritime and offshore services to the shipping, oil, gas and energy sectors has received the Dubai Chamber Corporate

News

Navy Awards Contract for Passenger Terminal Renovation in Hawaii

Naval Facilities Engineering Command (NAVFAC) Hawaii awarded a $20.5 million firm-fixed-price task order under a multiple award construction contract April 27 to Insight Pacific LLC,

Committee to Consider Coast Guard Authorization Bill

The U.S. Committee on Transportation and Infrastructure, chaired by U.S. Rep. Bill Shuster (R-Pa.), will mark up legislation this week that authorizes United States

Groups Seek US SEC Probe of Shell Arctic Drilling Risk Disclosures

An environmental group and a law clinic petitioned the U.S. Securities and Exchange Commission to investigate whether Royal Dutch Shell has adequately disclosed

Offshore Energy

Groups Seek US SEC Probe of Shell Arctic Drilling Risk Disclosures

An environmental group and a law clinic petitioned the U.S. Securities and Exchange Commission to investigate whether Royal Dutch Shell has adequately disclosed

Roxtec Seals for Floating Tidal Turbine

Roxtec provided its waterproof sealing solution to what is called  the largest and most powerful tidal turbine in the world. Roxtec UK managing director Graham

DNV GL Issues Design Guidelines for DP Operations

Advanced dynamic positioning (DP) vessels can now meet critical safety regulations while gaining operational flexibility, efficiency and cost savings through new design and monitoring methods.

 
 
Maritime Contracts Maritime Standards Naval Architecture Navigation Pipelines Salvage Ship Electronics Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2243 sec (4 req/sec)